Monopolistically competitive firms must produce where there is an optimal allocation of resources because the firms do not present significant barriers to entry to potential competitors.

A labor market is divided into two segments. All workers have the same qualifications and find jobs in either segment equally attractive. Initially, both segments are in competitive equilibrium. If the development of employer prejudice then reduces the employment of minorities in one segment, there will be a

a. permanent drop in labor supply to the discriminating segment b. permanent increase in labor supply to the nondiscriminating segment c. temporary drop in labor supply to the discriminating segment d. permanent drop in labor demand to the discriminating segment e. temporary drop in labor demand to the nondiscriminating segment

One of the benefits of money as a medium of exchange is that

A. it allows individuals to compare the relative value of goods. B. it allows for specialization that leads to economic efficiencies. C. it allows for private transactions such as trading vegetables for medical services. D. over time it will become more valuable so that individuals can purchase more goods and services.